Katter would not bail out sugar industry today

Geoff has been working for the QT since August 2011 covering Ipswich’s rural areas. He started working for APN in January 2010 with the Chinchilla News in western Queensland after growing up on a grain farm. Geoff spends his time out of work watching far too much sport following the Reds, the Broncos and various American teams.

BOB Katter has called for a Queensland rural reconstruction board but warned he would not bail out the sugar industry in its current state.

Now Federal MP for Kennedy, Mr Katter was the Queensland minister responsible for the Queensland Industry Development Corporation in the 1980s when it lent about $1 billion to struggling cane growers.

The QIDC was merged with the Suncorp and Metway banks in 1996.

Testifying before the Queensland parliamentary Finance and Administration Committee Mr Katter said a properly run reconstruction board could help rural areas cope better with droughts and market downturns but warned money should not be given out without proper consideration.

Mr Katter did not believe the Queensland sugar industry would qualify today for the QIDC support it received under him in the 1980s.

He said despite major competitors like Brazil embracing ethanol, the north Queensland cane industry was wholly dependent on the sugar price.

"The reason I couldn't do it now is that in Brazil, most of their sugar goes into the ethanol sector," he said.

"You've got to make a decision about ... if the industry is viable."

The committee is considering the Katter's Australian Party proposal to re-establish the rural reconstruction board and the Labor Party's Farm Debt Mediation bill.

Labor's bill would make mediation between a farmer and banker compulsory before a creditor could take possession of a mortgaged farm.

But a banking advocacy group told the committee they were concerned the bill was "unnecessarily complex".

Australian Bankers' Association retail policy director Diane Tate said the inclusions of internal and external avenues of appeal could add up to a year of uncertainty.